Sun Microsystems' new software to be free

By Associated Press | November 15, 2004

SAN JOSE, Calif. -- After investing roughly $500 million and spending years of development time on its next-generation operating system, Sun Microsystems Inc. today will reveal an aggressive price for the software: It's free.

Sun, which has never completely rebounded from the tech collapse in 2001, hopes the zero cost to consumers of Solaris 10 will not only attract customers but expand the number of developers who write programs that work on computers running the operating system.

The result, Sun believes, will be renewed demand for its servers and services. The company will charge subscription fees for Solaris support and service programs that are typically sought by the businesses and organizations that Sun targets.

''Hewlett-Packard sells a printer at a low price and makes a lot of money on printer cartridges. Gillette gives you the razor and makes a lot of money on the blades," said Scott McNealy, Sun's chief executive. ''There are different ways to drive market penetration."

Solaris 10 will be unveiled in San Jose, though it won't be formally released until the end of January. It will work on more than 270 computer platforms running on chips from Sun, Intel Corp., or Advanced Micro Devices Inc.

The price of earlier versions of Solaris typically ran between hundreds and thousands of dollars.

Sun also has promised to make the underlying code of Solaris available under an open-source license, though the details have not been released. With access to the code, Solaris users will be able to take advantage of its features when developing their own software and systems.

The move stands in contrast to Microsoft Corp.'s Windows and other proprietary operating systems in which the blueprints are released only to select outsiders, if anyone.

And, depending on the final license, it could make Solaris more competitive with open-source operating systems like Linux and distributors such as Red Hat Inc.

Solaris also will run programs written for the Linux operating system without having to make any changes.

Though Sun also sells lower-end systems that run Linux, it believes Solaris is a better value proposition. To strengthen its case, Solaris 10 will include security features that in the past were only part of a trusted version sold strictly to government agencies and the military.

Sun, a star of the late 1990s tech boom, fell on hard times as corporate spending shrunk and rivals like IBM Corp. and Hewlett-Packard Co. started offering machines with less expensive hardware and software.

The Santa Clara company has been trying to return to solid footing for years, and McNealy said Solaris 10 is an important part of the company's transformation.

''It's kind of the tent pole -- it just kind of holds up the whole deal," he said.

Last month, Sun announced its second consecutive quarter of revenue growth, though profits remain elusive. McNealy said he believes the company he cofounded in 1982 has already turned the corner, though the financials have yet to show it. ''There's always a lag with companies our size," he said. ''And that's assuming we're not making dumb mistakes right now that I don't know about."